2009-09-20

On having your ideas attacked . . . clues that you're winning the debate . . . and the common fate of dissenters

In The Black Swan--which was published in 2007 and foreshadows/explains the economic meltdown of 2008--Nassim Nicholas Taleb has strong opinions about some well-known professors of finance & economics including Myron Scholes, Stephen Ross and Martin Shubik.

This bit is from page 280:

It was symptomatic that almost all people who attacked my thinking attacked a deformed version of it . . . . Some even had to change my biography. At a panel in Lugano, Myron Scholes once got in to a state of rage, and went after a transformed version of my ideas. I could see the pain in his face.

Once, in Paris, a prominent member of the mathematical establishment, who invested part of his lifeon some minute sub-sub-property of the Gaussian, blew a fuse--right when I showed empirical evidence of Black Swans in markets. He turned red with anger, had difficulty breathing, and started hurling insults at me for having descrated the institution, lacking pudeur (modesty); he shouted "I am a member of the Academy of Science!" to give more strength to his insults. (The French translation of my book was out of stock the next day.)

My best episode was with Steve Ross, an economist perceived to be an intellectual far superior to Scholes and Merton, and deemed a formidable debater, gave rebuttal to my ideas by signaling small errors or approximations in my presentation, such as Markowitz was not the first to ..." thus certifying that he had no answer to my main point.

The insightful scholar Martin Shubik, who held that the degree of excessive abstraction of these models, a few steps beyond necessity, makes them totally unusable, found himself ostracized, a common fate for dissenters.